Dispelling the Myths About The Tax Cuts and Jobs Act

Last month, with my support, the House of Representatives approved the House-Senate compromise version of the The Tax Cuts and Jobs Act, landmark legislation which revamps our tax code for the first time in more than three decades. It means historic tax relief for middle class families and will revitalize our nation’s economy.

This bill is a good deal for Pennsylvania families, but many seeking to score political points have been deliberately misrepresenting the contents of the bill and what it means for hardworking taxpayers. I wanted to take a moment to set the record straight about some of the most common distortions.

MYTH: The Tax Cuts And Jobs Act raises taxes on the middle class

FACT: The vast majority of taxpayers will get a tax cut. A typical family making $136,400 — the median income for a household of four in the 7th District — will see a tax cut of about $4,700. A single mom making $41,000 per year will see a tax bill 73 percent lower than under current law. That’s more money that these families can use to make ends meet.

This chart, courtesy of the Tax Foundation, shows how the bill will help several types of “sample” taxpayers

MYTH: This bill cuts Social Security, Medicare or Medicaid.

FACT: Nothing in the bill affects benefits for Social Security, Medicare or Medicaid enrollees, and any assertion to the contrary is false. In fact, the deduction for medical expenses utilized by so many seniors with heavy medical bills is preserved and made more generous.

MYTH: The bill eliminates the deduction for state and local property taxes.

FACT: The bill retains the deduction for state property or income taxes up to $10,000 — a threshold higher than the average property tax burden for a majority of tax filers.

MYTH: The bill is bad for upper middle income households in our region.

FACT: The bill preserves important deductions like mortgage interest, charitable contributions, and state and local taxes. The bills lowers rates across the board, meaning that even if a taxpayer’s taxable income stayed the same, their overall tax bill would go down. And it greatly increases the threshold for the Alternative Minimum Tax, which hits thousands of upper-middle income tax filers in our area.

MYTH: The bill will kick 13 million Americans off their health insurance.

FACT: This is false. No American will be kicked off their insurance. The bill repeals Obamacare’s individual mandate tax. It’s a tax that disproportionately hits low- and middle-income families. In Pennsylvania, almost 225,000 taxpayers were hit with the tax — more than 40% of them making less than $25,000 a year and 83% of them making under $50,000 a year.

MYTH: The tax bill will hurt graduate students.

FACT: The provision affecting the tax treatment of graduate students was not included in the final legislation, and I’m pleased to see it was removed.

MYTH: The tax bill eliminates the deduction for teachers’ expenses on supplies for their classroom.

FACT: The teacher expense deduction was not affected by the tax bill.

Democrat economists have said that the tax bill will literally kill thousands of people. Nancy Pelosi said it will mean the end of all human life. There is no claim the Democrats won’t make, no matter how dishonest or outlandish, in a desperate attempt to derail an attempt to cut taxes on the middle class. Putting more money in people’s pockets and sending less of it to Washington is good for the Pennsylvania families I serve. That’s why I supported the legislation.